Food Truck aRepas - getLaunched®constant growth numbers (Gulfood, 2016). However, nowadays the...

Food Truck aRepas

Business Plan

Julia Lehmann & Jessica Wiedmer

Example 2: Food Truck aRepas Julia Lehmann & Jessica Wiedmer

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Executive Summary

We are aRepas, the first and only food truck cruising through the neighborhoods of Lörrach. Our delicious grilled Latin American arepas filled with lots of love are ready for being explored by everyone who is hungry to experience unique cuisine. Made of maize and combined with a variety of locally sourced ingredients, our arepas represent the perfect food choice for individual taste. It has to be highlighted that arepas are gluten-free. Thanks to this and its organic sourcing, arepas can be enjoyed by people with a wide range of allergies and incompatibilities. With fixed locations in the city center of Lörrach aRepas targets 1% out of the daily estimated 10’000 inner-city employees and residents. Beside these regular pedestrians as our main customer group, aRepas also caters for city tourists, any kind of fans or food lovers and event visitors. Based on a weekly 26-hour food truck occupancy in 45 weeks per year, aRepas expects following financial outcome in the first business year:


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These figures illustrate that aRepas is not dependent on investors in order to be profitable. Hence, this report has been initiated:

- as guide for the management, providing a proper overview of the business environment and therefore a solid base for operational activities

- as reference for Pro Lörrach, the municipalities’ association of trade and commerce, with which we aim to partner to increase the inner-city’s attractiveness

We, as sole proprietors, pride ourselves on serving experimental highly-qualitative cuisine while adding the social and trendy attributes of the food truck business. We are not born chefs, neither did we go to culinary school; nevertheless, we fell in love with arepas and enjoy interacting with people. This goes hand in hand with our fascination of dipping into foreign cultures and exploring extraordinary food. So, all of our effort is put into our service to share our experiences with our local neighborhood.

aMAIZE Yourself – aRepas awaits YOU!


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Table of Content

Executive Summary ................................................................................................................ 2

1 Enter the World of aRepas ................................................................................................... 5

2 The Food Truck’s Playground ............................................................................................... 7 2.1 The Mobile Food Industry in General ..................................................................................... 7 2.2 The External Business Environment ....................................................................................... 7 2.3 Competitive Strengths of the Food Truck Industry .................................................................. 9 2.4 The Competition ................................................................................................................. 10

2.4.1 The Streets of Germany........................................................................................................... 11 2.4.2 The Streets of Switzerland....................................................................................................... 12 2.4.3 Detailed Competitor Analysis .................................................................................................. 13

3 Who we serve .................................................................................................................... 16

4 How we do it – our marketing plan .................................................................................... 21 4.1 Product ............................................................................................................................... 21 4.2 Price ................................................................................................................................... 21 4.3 Place ................................................................................................................................... 22 4.4 Promotion .......................................................................................................................... 23

4.4.1 Social Media Marketing ........................................................................................................... 23 4.4.2 Non-social Media Marketing ................................................................................................... 24

4.5 Market Entry Budget ........................................................................................................... 25

5 Financial Plan .................................................................................................................... 25 5.1 Pessimistic Financial Scenario .............................................................................................. 26 5.2 Optimistic Financial Scenario ............................................................................................... 28

6 Risk Analysis ...................................................................................................................... 30

7 Action Plan / Preparing for the streets of Lörrach ............................................................... 34

8 Future ............................................................................................................................... 36

9 Management Team ............................................................................................................ 37

References ........................................................................................................................... 39

Appendix .............................................................................................................................. 41


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1 | Enter the World of aRepas

An arepa is... ...a traditional flat bread made of maize flour, water and salt, which has its origin in the Venezuelan local tribe Timoto-Cuicas. Still today it is prominent in the Latin American cuisine and popular all over the world. Arepas vary from region to region; they can be fried, baked or grilled and eaten for breakfast, lunch and dinner. It is formed into a patty, split open and topped or filled with a variety of ingredients depending on size, individual taste, season and time of the day. This allows eating the arepa like a sandwich. Arepas are gluten-free products and due to the organic sourcing of ingredients, they are an attractive choice for people with a wide range of allergies and incompatibilities. Food Truck aRepas – who we are We are aRepas, the first and only food truck cruising through the streets of Lörrach. Our delicious grilled Latin American arepas filled with lots of love, are ready for being tasted by neighbours and food lovers of regional events and street food festivals. aRepas current menu serves for lunch and dinner but occasionally also for breakfast. At the moment the five core offerings La REINA, La ORIGINAL, El CARIBE, La VEGGIE and Mi FRESA decorate our blackboard. Seasonal arepa specials will be added according to availability of fresh and local products.

With our extra menus we aim to provide flexible creative products to constantly innovate our food choice. We encourage our customers to explore new compositions.


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Most ingredients will be sourced from local food suppliers and farmers to guarantee the freshness and tastiness of the dishes. Of course some special Latin American ingredients that make arepas so unique are needed.

Not to forget that aRepas clients won’t get thirsty - a wide range of daily fresh prepared homemade organic lemonades and iced teas await the customers, bringing the Latin American lifestyle a little bit closer. Depending on season and availability this offering might change.


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2 | The Food Truck’s Playground

This comprehensive market overview shows how aRepas represents a strong addition to the existing food truck industry. Before giving a thorough market overview, it has to be clarified where the boundaries of the industry are set. Food trucks clearly differentiate from kiosks, and mobile snack bars such as supplementary mobile stands of local restaurants, bakeries and butcher, which often can be found in front of supermarkets. Food trucks have their own philosophy and attract customers by creating a unique food experience with their individualized designed trucks (Imbisskult, n.d.). The food truck industry can be classified as a business where meals are prepared and served from a mobile truck. It therefore also can be defined as a restaurant on wheels or a mobile restaurant (Profitable Venture, 2015). The truck itself is equipped with all necessary kitchen utensils in order to be able to prepare, store and cook the dishes. In general, a defined location is not required in the food truck industry. As long as all legal obligations are met, the locations of food trucks can change daily (IBIS World, 2015). The overall aim of food trucks is to offer customers a chance to experience different and creative dishes at reasonable prices.

2.1 | The Mobile Food Industry in General

The food truck phenomenon is existent for eight years and especially in the UK and US registers constant growth numbers (Gulfood, 2016). However, nowadays the trend increasingly targets other European countries, including Germany and Switzerland and does not even stop in Asia (Profitable Venture, 2015). Due to the relatively new development, numbers around market volume are rare. However, it has been revealed that in the US, a total of 4’130 registered trucks are generating 1.3 billion USD per year industry with a market growth rate of 12.4% over the last five years (Gulfood, 2016).

2.2 | The External Business Environment

The following PESTEL analysis examines the general external business environment and the mobile food industry specific factors that may affect our business.


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By taking into consideration the above illustrated external factors, aRepas can use its business strengths such as its commitment to food quality and safety as well as future marketing campaigns to fully exploit all potential business opportunities and to prevent any risks. *One particular topic of above: LEGAL The beauty of a food truck is its mobility. You can take it anywhere, park anywhere, and serve all kinds of customers—right? Well, not exactly. Also food trucks need to be officially registered as a company. The German limited liability company (GmbH) is the most common and easiest form for corporations. The aRepas business will also be set up as a GmbH, requiring a minimum share capital of 25’000.00 EUR, and will be managed and legally represented by its two owners. Below further legal requirements need to be been taken into consideration for the aRepas food truck in Lörrach.

- Trade license for caterer (Gewerbeschein für Gastronomen - trade registration center) - Formula for tax registration (Formular zur steuerlichen Erfassung - finance office) - Health Certificate (Health Office) - Health-legal permission (Gesundheitsrechtliche Erlaubnis - regulatory agency) - Food hygiene training according to EU regulation (EG) (Lebensmittelhygiene-Schulung

nach EU Verordung (EG) - first instruction at health office) - Instruction according to §43 Law on the Prevention and Control of Infectious Diseases

(Belehrung gem §43 Infektionsschutzgesetz (IfSG) - first instruction at health office) - Proof of Instruction for Restaurants (Unterrichtungsnachweis für Gaststättengewerbe -

chamber of trade and commerce)


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- Immissionsrechtliche Genehmigung - Permission of Lörrach’s local municipality for operation on public places

2.3 | Competitive Strengths of the Food Truck Industry

Threat of New Entrants Mobile street food was born to give customers quality, affordable and different fast food – nowadays it’s a fast growing industry, easy to enter for anybody. This represents the reason why the threat of new entrants within the food truck industry is high. But not only the ease of entering, also the increasing popularity makes this industry becoming a more and more competitive one. Compared to the restaurant business, it represents an easier business to break into - lower entry barriers allow setting up a food truck quicker, cheaper and less risky. The threat of new entrants also comes along with an increasing matter of dispute about the best locations to sell. Not only for aRepas, established street food markets represent a food trucker’s best bet for regular trade. We expect new entrants in and around Lörrach, but due to the to date unpopularity of arepas in the region we assume no direct competitor offering the same product in a food truck.

Bargaining Power of Suppliers There are few farmers’ markets in the area of Lörrach, giving aRepas the opportunity to negotiate favorable prices for raw materials and fresh ingredients. In addition, due to the large amount of portions, future potential discounts can be negotiated in the favor of aRepas.

Bargaining Power of Buyers Although there are a few food trucks nearby, none is offering a similar product like aRepas. Since potential competitors from Basel and Freiburg offer burgers and Mexican food, we do not expect to encounter any pressure to lower our prices.


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The growing trend towards freshly prepared and healthy gourmet food, allows maintaining a higher price point.

Availability of Substitutes Of course every restaurant, kiosk and mobile stand represents a substitute for aRepas. However, they do not offer the flexibility, unique experience and special taste of Latin American arepas. This unique selling proposition represents a strong incentive to win and retain customer loyalty. NB: Sub-chapter 2.4 gives further detailed information on competition

Competitive Rivalry The food truck industry is a big community where pride and mutual support exceeds the competitive thinking. Nevertheless the existing food trucks in Freiburg and Basel belong to the main competitors of aRepas. Of course, the potential success of aRepas could encourage others to mimic the business model and / or add arepas to their menus. NB: Sub-chapter 2.4 gives further detailed information on competition

2.4 | The Competition

The competitor analysis introduces all relevant current and potential competitors from the client’s perspective and assesses the decisive strengths and weaknesses of each individual business rival. Furthermore, the client’s crucial criterion for the selection of one competitor's products and services will be compared. For a better overview, the analysis has been divided into three parts. Firstly, direct competitors, who offer the similar products or services to the same market segments. Secondly, the indirect competitors who have the same clients and serve the same needs by offering different products or services. The last and often referred to as the strongest group is the indirect competition, which consists of all other solutions the clients choose to meet their needs based on their habits. The indirect competition in this case would comprise all customers only eating their own prepared food and never using food truck, take away or restaurant services.


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All competitors highlighted on the following pages have their business location close to Lörrach, since this represents the core business environment of aRepas.

2.4.1 The Streets of Germany

Owing to the fact that the food truck aRepas will operate in the region of Lörrach, it is important to critically analyze the food truck market in Germany. Thanks to the relatively new and fast growing industry, a specific and detailed calculation of the German market volume is not feasible. According to Markus Wolf (2015), an expert of the German food chemistry, the food truck market in Germany will achieve a volume of 2 billion EUR within the next 10 years. Germany’s food truck industry has experienced a remarkable rise as consumers have increasingly favored unique, gourmet cuisine at budget-conscious prices. At the moment there are 248 food trucks officially registered throughout Germany. However, since aRepas’ area of operation represents the south of Germany, close to the border of Switzerland and France, it is important to analyze where these potential food truck competitors are located. The map below points out the cities with the highest number of registered food trucks. These 163 food trucks are covering already 66% of all food trucks across Germany (Foodtrucks Deutschland, 2016).

As highlighted, the city of Lörrach does not have any registered food truck. The closest cities with food truck availability are Stuttgart (approx. 250km from Lörrach) and Freiburg (approx. 70 km from Lörrach). Due to their distance from Lörrach, all further cities shown in the map are not touching the daily operations of aRepas.


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The table below gives an overview of the nine food trucks operating in the area of Freiburg, which are closest competitors.

Since their daily operation takes place in the region of Freiburg, these nine trucks particularly specialized in burgers and Mexican food, are no relevant competitors of aRepas. Of course, for food festivals and events it is important to keep these trucks in mind, especially the ones with catering and event service offerings.

2.4.2 The Streets of Switzerland

Due to the fact that Lörrach is located next to the Swiss border, food trucks in the region of Basel (10km from Lörrach) can be classified as potential competitors of aRepas. In 2015 the food truck trend arrived in Switzerland and celebrated phenomenal successes with street food events in Basel, Bern, Lucerne and Olten. Today, a total of 47 food trucks are registered in Switzerland, in Basel 5 food trucks are operating (Streatfood, 2016).


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Basel’s food trucks are focusing the Swiss market and do not offer arepas. Consequently, the five existing trucks do not affect aRepas daily business. Further, due the strong Swiss Franc and their comparably high operational costs, Swiss food trucks are not in a position to make profit on the German market. Only for food truck festivals and potential future catering and event options they should be considered.

2.4.3 Detailed Competitor Analysis

The main product of the food truck aRepas is the filled and topped cornbread arepa. Based on this product focus, the figure below illustrates the strengths and weaknesses of all product-related direct and indirect competitors.

Direct Competitors:

Strengths Weaknesses

Food truck offering arepas

There are currently no food trucks offering arepas in the region.

Restaurant / Take Away offering arepas

According to thorough market analysis, there are no Venezuelan / Colombian restaurants or take away possibilities offering arepas in the region.

Conclusion: Consequently there are no direct product-related competitors in the region to the food truck aRepas.

Indirect Competitors:


Existing food truck offering burgers & local

offer already known food to customers so that customers know what to expect, more experience

Often offer no choice for people with gluten / wheat / yeast allergies, give customers no


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food in preparation, can source almost all ingredients locally, personalization, flexibility Client’s criterion for selection: knowing the food / offer, personal relationship, prefer local food, low price, fast service, personalization, individual taste preference, like the urban and trendy eating atmosphere, local sourced food

opportunity to taste something new, do not provide exotic atmosphere & Latin American spirit

Food truck offering other foreign dishes (Pizza, Indian food, Thai food)

Mostly specialized on dishes that customers know, provide exotic feeling to customers, personalization, flexibility Client’s criterion for selection: knowing the food / offer, personal relationship, low price, fast service, personalization, individual taste preference, like the urban / exotic eating atmosphere

Often offer no choice for people with gluten / wheat / yeast allergies

Take Away Restaurants / Supermarket Offers, Fast Food Chains, Kiosks, Bakeries

Not dependent on weather, regular revenue streams, established relationships with suppliers and customers, loyal customers, more space for preparation of dishes, fast Client’s criterion for selection: knowing the food / offer, location does not matter since it is the same food in every fast food restaurant of the chain, hungry while doing the grocery, fast, no time to cook, easy, not interested in convenient dining atmosphere

Dependent on location, less flexible regarding opening hours, probably more expensive, less flexible regarding product offering (have to stick to overall company’s strategies), often offer no choice for people with gluten / wheat / yeast allergies, less attractive atmosphere, less personalization, higher fix costs

Restaurants, Cafeterias

Not dependent on weather, regular revenue streams, established relationships with suppliers and customers, loyal customers, more space for preparation of dishes, more

Dependent on location, less flexible regarding opening hours, more expensive for customers, higher fix costs (rent, salaries, furniture), often offer no choice for people with gluten, wheat,


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convenient eating opportunities, offer alcoholic beverages, personal service, offer bigger variety of dishes Client’s criterion for selection: prefer more convenient eating atmosphere, personal service, don’t have to go outside

yeast allergies, less mobility

Conclusion: The indirect competitors often can benefit of their already established supplier and customer relations, bring more experience and are less dependent on weather. However, they do not always provide customers the personalization and flexibility offered by food truck aRepas. And not to forget that they mostly offer no attractive choices for people with gluten, wheat or yeast allergies.

In the future food truck aRepas will also offer flexible and mobile catering opportunities for corporate and private events. A detailed overview of the potential service-related competition can be found in the appendix.

2.5 | The Bright Future It is clear that the experimental cuisine as well as the social aspect of street food that comes with it is a growing trend, not only in the US, but also in Switzerland and Germany. Of course, any business needs to watch and be prepared for changes in the market. The expected growth rates definitely could attract many people to start their food truck business in the coming years and make the scene more competitive. This also applies for the Dreiländereck region Lörrach and Basel.


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3 | Who we serve

Our customers are our first priority. All of our effort is put into constantly exceeding their expectations. aRepas is designed for everybody. Our concept addresses women and men of all ages, living and visiting the city of Lörrach. However, we expect that our biggest buyers will be young adults aged between 25 and 44 years. Since according to a survey, those young adults represent the largest customer group of mobile vendors (SBDCNet, 2010). Our defined target groups of aRepas are shown below.


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Regular Pedestrians

Regular pedestrians pass by aRepas food truck in Lörrach almost every day due to their everyday duties and habits such as going to work or school, doing grocery shopping or when following their leisure activities. They know exactly about aRepas offers, location and opening hours.

aRepas target market Lörrach with its total of 49’000 inhabitants, whereof approximately 20’000 are living in the city center, has a high amount of regular pedestrians. Approximately 20’000 workplaces are available in Lörrach - 5’000 of them across all industries like the banking sector, gastronomy, medical sector and various others are solely based in the city center (Lörrach, 2016a). The number of students visiting schools and universities in proximity to all our selling locations exceeds 5’000 (Statistisches Landesamt Baden-Württemberg, 2016). The relatively low distances within the city center, attract even more regular pedestrians. Out of these 10’000 potential regular pedestrians we assume to cater in average 1% during their rush times (lunch and after work).

Their problems, pains and needs Business people, students and other regular pedestrians normally have little time and are hungry during their breaks or after their everyday duties. They do not have time (and money, in case of students) to visit a restaurant. aRepas regular pedestrians are looking for something healthy, quickly prepared for an affordable price to eat on their way.

aRepas way of satisfying their needs aRepas offers the optimal choice as it is quickly prepared, easy to eat and can be enjoyed throughout the day. These regular customers profit of the changing menu and welcome aRepas attractive organic food solutions for an affordable price.


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Non-regular Pedestrians

Non-regular pedestrians are people that come across aRepas randomly during their shopping day or when visiting the city of Lörrach. These are people from Lörrach itself, but also from other regions or from the neighbor countries Switzerland and France.

aRepas target market The high amount of tourists visiting Lörrach each year, as well as numerous shopping day tourist from Switzerland and France, appreciate the alternative food choice. This is supported by the more than 3’000 available parking’s in the city of Lörrach (Lörrach, 2016b), which especially during weekends are always complete.

Their problems, pains and needs Non-regular pedestrians are becoming hungry throughout the day and might want to have a snack while exploring the city of Lörrach. They generally have more time to explore the aRepas menu.

aRepas way of satisfying their needs aRepas offers unique dishes with original side offerings like our homemade organic drinks for people to discover. An arepa is the perfect snack for non-regular pedestrians to satisfy their appetite.

Fans & Followers and Food Lovers

The so-called FF’s are very loyal customers who enjoy the aRepas offering on a regular basis. The food lovers are people who are open for new foods and see the value in high-quality food as aRepas offerings. Both target groups follow the food truck on social media, are interested in getting to know the locations and latest menus. Further, they also share their opinion and do word-of-mouth marketing.

aRepas target market Food lovers can be found anywhere – also in Lörrach. Fans and Followers are a fast growing target group due to the great support from families and friends.


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Their problems, pains and needs They are truly convinced by the products and want to eat arepas on a regularly basis. Especially food lovers desire new and unknown specialties.

aRepas way of satisfying their needs We provide a changing menu of high quality arepas to convince our FF’s and food lovers to regularly come by and do as much as possible worth-of mouth marketing for aRepas.

Event Visitors

For us generally event visitors represent those people enjoying street food festivals. Nevertheless, we also consider all people participating in occasions like live concerts or shows, movie screenings, Christmas markets, holiday parties, or tournaments and contests in the region of Lörrach, as event visitors.

aRepas target market Street food festivals are taking place on a regular basis around the region of Lörrach attracting high amount of visitors. Below some examples:

- Basel (May 20. – 22. and August 19. – 21., 2016) - Lörrach (April 3, 2016) - Strassburg (June 3, 2016) - Baden (May 6. -7., 2016) - Olten (June 24. – 25., 2016)

Their problems, pains and needs They require highly qualitative, freshly prepared food in a convenient dining atmosphere. Event visitors are looking for unique and changing food offers as they desire new and unknown specialties. Money is not a main concern for event visitors. They are willing to spend their money on fancy new dishes.

aRepas way of satisfying their needs Arepas are not known in the area around Lörrach. Therefore, aRepas satisfies their need by providing high quality and a new food experience.

A product survey has been conducted with 25 randomly selected people in Basel. All participators confirmed that arepas meet their taste and represent a new attractive choice on the local food market. All of them would count themselves to aRepas future customer base.


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4 I How we do it – our marketing plan

A menu and a truck to remember… We are Lörrach’s first and only food truck serving authentic Latin American cuisine! aRepas is proud to be an all-natural and gluten-free kitchen where people around Lörrach can come and try some delicious arepas and share the #arepaslove at #aRepas. For a food truck, its exterior design and presentation as well as its interior high qualitative food, defines the unique selling proposition. A plain white truck is not likely to create much attention. Our self-made colorful aRepas food truck and our signature dishes, highlight the originality and uniqueness of the aRepas’ brand. This is exactly what will drive our customers to constantly track us and become true fans and followers. We want our customers to become our best advocates. With the transparency of the Internet and the potential that lies in there, the highest focus of aRepas is to create lively and ongoing communication.

4.1 I Product

To keep it short and precise our product is a grilled corn flour patty, stuffed with tastiness. A more detailed description can be found in Chapter 1. But attention, Arepamania can happen after a single bite already.

4.2 I Price

Since arepas are focused on natural and organic ingredients keeping the environment in mind, the prices reflect this high quality and are set accordingly. Our customers are aware of our premium products and are willing to invest in this superior taste.


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4.3 I Place

People in Lörrach should be able to run into aRepas without going too far off their regular way. The illustrated locations have been chosen with utmost attention. Their decision criteria are outlined in the table below.


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Marktplatz, Lörrach - City Center - Place to meet - Huge amount of pedestrians and tourists - Shopping possibilities

Meeraner Markt, Lörrach - University near by - Big local companies (KBC, Raymond, Innocel) - Shopping, Bars and Gym

Hebelpark, Lörrach - Shopping street - Close to train station, banks and parking

Rosenfelspark, Lörrach - Several Schools nearby (Hebel Gymnasium, Hans-Thoma Gymnasium, Theodor-Heuss Realschule)

4.4 I Promotion

4.4.1 Social Media Marketing

Facebook and Instagram have become the hottest marketing tools for mobile food entrepreneurs to stay in touch with their customers and fans - and this is exactly why aRepas will put all efforts into a strong web presence and a high page ranking in major search engines.

WHAT aRepas FACEBOOK Page

- Platform of information about business & products

- Event calendar with location details

- Visual brand appearance with pictures and videos

- Place for direct feedback from customers

aRepas INSTAGRAM Page

- Visual brand appearance with pictures and videos of products and events

- Place for direct feedback from customers

WHY aRepas Facebook page creates a place for ongoing interactive communication with our customers and represents the most important touch point to create sustainable long-term relationships. aRepas customers are directly informed, receive direct and fast information

As human beings, we are naturally intrigued by visual content. Seeing a friend’s picture taken at aRepas food truck may lead people to come by aRepas for the first time.


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but also have the possibility to give direct feedback. It is an excellent combination of owned content (own posts, pictures and videos) and earned content, which consists of customers comments and ratings. Our main aim is to foster a lively communication and by doing so build a strong reputation.

HOW We get traffic on our Facebook and Instagram page through several campaigns: - Facebook and Instagram logo on food truck with invitation to join - Free of charge product giveaways with aRepas flags and Facebook link - Flyers - Invitations to friends on Facebook & Instagram #aRepas - Word of mouth - “Create your own Arepa” Competition

4.4.2 Non-social Media Marketing

Poster & Flyer aRepas will use posters and flyers as a communication tool to spread information quickly and to build awareness - especially in the beginning. Flyers are inexpensive and the methods of distribution relatively easy. To reach our target audience, flyers will be distributed at our truck, but also on different locations and in big companies within the city of Lörrach.

Partnerships To increase our marketing power and to reach a broader audience it is our aim to partner with other local businesses. Beside the partnerships with various local farmers, aRepas intends to build further partnerships and considers co-sponsoring event options with a local charity, company or even a local bar.

Word-of-mouth Marketing aRepas will also use word of mouth as an extremely important marketing tool to spread the word about its high value food choice.

At food truck advertising Our colorful food truck is definitely an advertising instrument itself and represents already an eye catcher. Our customers will not only be invited to like our


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Facebook page and follow us on Instagram but also all our upcoming events will be promoted directly at the truck. aRepas will be covered by graphics and posters. In addition, aRepas owners will be handing out flyers to our customers when they make it up to our service window. This will keep customers informed of any special happenings.

Food Truck Festivals Marketing

Being part of a street food festival is an important method to make the public aware of aRepas and maintain and attract the interest of our existing and potential customers. aRepas will be constantly on the lookout for potential events throughout Lörrach. All kind of food truck festival will be taken into account, but also other occasions, including live concerts or shows, movie screenings, holiday parties, or tournaments and contests.

4.5 I Market Entry Budget

All mentioned market entry strategies are highly based on social media and worth of mouth, which are not connected to any kind of costs. However, an annual budget of 5’000.00 EUR is calculated for other marketing related activities. Of course setting up an own homepage in the future would require additional budget.

5 | Financial Plan

The financial plan shows how aRepas predicts sales growth over the first five years. Mobile trucks are facing the similar range of concerns as other businesses in the food industry. Not only a variety


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of permits are necessary, but also insurance, labor and fuel costs need to be taken into account as well as a fixed business location to accept the delivery of supplies and for storage, which in our case represents our home garage. In order to start aRepas, we both invest 25’000.00 EUR each and, in addition receive a bank credit amounting 50’000.00 EUR, which will be paid back over a period of four years. The biggest investment is the truck purchase itself, costing us in total 60’000 EUR. Our truck has been carefully selected and is fully equipped with all essential and needed kitchen utensils. We estimate a ten-year useful life with a yearly linear depreciation of 6’000 EUR. Further high cost factors are the incurring licenses and rents for selling locations in the streets of Lörrach and also relevant food truck festival fees. The estimated amount of 25’000.00 EUR has been calculated based on an interview with a Basel food truck owner in combination with information received from Lörrach’s municipality (Appendix). Our yearly salary is set at 50’000 EUR for both owner and is computed on the basis of an hourly wage of approximately 14 EUR (assumption of a 45 week per year and 40 hours work week). All data referred to in the following financial overviews have been prepared with the assumption of a 45-week business year. At the stand itself we are both present around 26 hours a week, excluding additional hours for the overall coordination of the business (40-hour week). Further, thanks to arepas’ in general quick preparation including cash up time (45 seconds – 1 minute), we are in a position to cater for rush demands. Below scenarios, outline the pessimistic as well as optimistic financial outcome of aRepas.

5.1 I Pessimistic Financial Scenario


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An estimated amount of 750 arepas (and 400 drinks) per week (see detailed calculation in Appendix), gives us an average preparation time of 4.16 minutes for each arepa.


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5.2 I Optimistic Financial Scenario

An estimated amount of 1’100 arepas (and 600 drinks) per week (see detailed calculation in Appendix), gives us an average preparation time of 2.83 minutes for each arepa.


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6 | Risk Analysis

The table below highlights potential risks, the food truck aRepas could face during its operations. The challenge hereby is to avoid the worse risks and proactively manage the moderate risks and make our food truck highly competitive. We see it as very important to learn from the experiences of other food truck owners.

Risk

Description & Negative effect of incidence

Instruments to avoid risk or to decrease effect

Clients with Corn Allergies Food truck aRepas offers products made of maize flour, which can lead to allergic symptoms for some people. However, allergies against wheat, gluten and

aRepas clearly points out that its products are made of maize flour, which is also noticeable due to the big corncob illustrated on the food truck. Further, all


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pollen are more widespread than maize allergies.

ingredients are listed in detailed overviews and available for every visitor to read before the purchase.

No Permission to sell on public places

Having the right location with lots of pedestrians passing by is an important factor. Without surprise locations in the city center, like market squares and parks, represent the most attractive locations. For some of these places it is difficult to get permissions from the local municipality.

It is important to build good relationships with the local municipalities and explain the benefits of our truck and that it will add to the overall attractiveness of the city. Weekly markets are more open to give permissions to food trucks. Moreover, alternative locations, like private parking’s and business premises have been proactively chosen.

Other Food Trucks / Imitators

Since the industry is still in its early stages and there is a lot of room for further growth, for sure also the competitors will come.

aRepas focuses on its niche product, the Latin American arepas, and offers unique and individual food experience at a constant high quality level. Further aRepas represents the first food truck in Lörrach and can benefit of its early market entry and already loyal customer base. Pizza, burgers and Döner are available at every corner.

Bad Weather Of course people generally stay inside if it is pouring rain.

Since nobody can change the weather, it is important to listen to forecasts and be prepared to move to alternative locations, which offer clients some protections of the rain. During the winter season aRepas will be present at Christmas markets throughout the region and


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other events like Carnival.

Limitations for Food Trucks Germany already has lots more limitations for food trucks and since it is considered a growing trend industry, it is expected that regulations will be more liberalized in the future.

It is important to know all limitations and regulations applicable for the food truck industry in order to be able to plan for the future.

Ignorance of foreign product by customers

Arepas have their origin in Venezuela and are generally not known in Germany. Some people will be afraid of getting to know foreign food and will avoid testing it.

To avoid ignorance of foreign products by customers, aRepas regularly offers sample arepas on the street for free to make people aware of the good taste to make them overcome the ignorance.

Illness / Accident of one owner

Unfortunately accidents and illnesses can happen every day and you never have the chance to foresee such catastrophes. The loss of one of us will represent a big deficit since the business is dependent on two full-time workers.

We take care on each other and have good support from families and friends, who are prepared to help in case of such unforeseen events.

Damage at Food Truck Since our truck is new and fully equipped, there should generally not be any maintenance issue due. However, damages can happen every day and if this damage prevents us from driving from one location to another, it clearly harms our business.

The food truck is our business!! We have to pay utmost attention to keep it fit for services every minute.

Resistance from local restaurants

Our offer clearly represents an added value to the local food offering and not all restaurants will welcome us.

We definitely do not want to be anyone’s enemy and will start communication with all stakeholders about our concept and the focus on street food to avoid any


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future resistances.

Low Traffic Location The right location is the key for success. A bad location without traffic definitely affects aRepas sales figures. Without a good location, we are not able to reach the customers we want.

With our food truck we will quickly pack our staff and move to the next location. If one location does not work, food trucks can easily drive to another location.


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7 | Action Plan / Preparing for the streets of Lörrach

February – May 2016 Idea Development

Market Analysis (Competitors, Customers, Environment) Food Truck Selection & Product Design Product Survey (distribution of arepas)

01 June 2016 Business Plan Presentation 13 June 2016 Meeting at Bank for Credit

Mid June – August 2016 Food Truck Purchase & Redesign Work Renovation of Storage Room / Garage (Home) Administrative Work

Legal Requirements (Health Department, Finance Office, Trade Registration Meetings with local municipality

Start of Marketing Facebook page (invite friends and family to share) Distribution of flyers Distribution of product samples 19 – 21 August 2016 Participation Food Truck Festival Basel 23 August 2016 Hebelpark Lörrach (11:30 – 13:30) 24 August 2016 Meeranermarkt Lörrach (11:30 – 13:30) 25 August 2016 Marktplatz Lörrach (16:00 - 20:00)

You will certainly run into aRepas – if not, please check the current location on facebook. aRepas looks forward to meeting you soon!


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aRepas weekly fixed locations


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8 | Future

Since the owners of aRepas do not want to keep back their delicious product from neighbors and visitors of their beloved region for too long, they are somehow in a hurry to acquaint everyone with their Latin American arepas. That’s why in the beginning the emphasis is placed on aRepas’ core, the high quality and sophisticated preparation of arepas and the very personal interaction with customers. For sure, aRepas never stops being creative and constantly innovates its offer and improve the customer experience. As an example, smaller sizes will be added to the standard portfolio to enable very undetermined customers to enjoy the unique taste of more than one single arepa. Further, aRepas will be prepared to cater parties and business events in the future and is happy to provide individual, tailor-made offerings for every occasion. All relevant and detailed information will be available on aRepas’ coming website, which will represent the perfect add-on to the early established Facebook page. The cooperation with companies will be emphasized to guarantee further revenue streams. After being settled in Lörrach, a regional expansion will be the next step to increase the customer base and market coverage of aRepas. With the bright future ahead, the owners certainly will have to think about hiring additional service members in order to guarantee that the high quality and quick preparation time are always met and fully satisfy all customers.


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9 | Management Team

aRepas will be managed completely by Julia Lehmann and Jessica Wiedmer. Together they take care of the cooking, sales, purchasing, contracting as well as public relations and are happy to represent the direct faces of aRepas. “Give everything for the truck – work hard, play hard.”

This precious advice of an industry insider and food truck owner is exactly the motto of the two friends. Both are very passionate about the aRepas food truck and have the desire to establish a unique food experience with individual touch and constant high level of quality. They are always keen to create relationships with customers through lively interaction and are happy to receive honest feedback. The motivation to create something unique with their own hands is the driving force behind the concept of aRepas. Julia Lehmann Julia is one of the proprietors of the food truck aRepas. Originally from the region of Freiburg, also in the south of Germany, she settled in Lörrach due to her studies at DHBW 5 years ago. Thanks to her Portuguese roots and parts of her family being in Venezuela, she is responsible of bringing the original Latin American tastiness to Lörrach. These cultural influences combined with several years of practical working experience in a multinational organization are contributing valuable business know how. Julia holds a BSc and a BA in International Business Management (2015) and a MSc in International Management (2017).


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Jessica Wiedmer The second proprietor of the food truck aRepas is Jessica, who grew up in the region and is very familiar with the local market and its inhabitant’s preferences. Thanks to plenty of job experience in the fields of caterings, hospitality services and the food and beverage industry, Jessica can contribute to the food truck aRepas with her industry knowledge and learned competences in face-to-face customer service. Further, Jessica has a BA in Tourism Management (2013) and a MSc in International Management (2017).


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References

Foodtrucks Deutschland, 2016. Liste aller Foodtrucks aus Deutschland. [online] Available at: <http://www.foodtrucks-deutschland.de/trucks/food-truck-liste-deutschland> [Accessed 3 May 2016]. Gulfood, 2016. 2.5 billion people are served by the street food industry everyday. [online] Available at: <http://www.gulfood.com/Content/25-billion-people-are-served-by-the-street-food-industry-everyday> [Accessed 1 May 2016]. Imbisskult, n.d. Projekt – Mobile Imbiss-Konzepte mit frischen Gerichten und dem Mega-Trend FOOD TRUCKS!. [online] Available at: <http://www.imbisskult.de/projekte/foodtrucks/> [Accessed 10 May 2016]. IBISWorld, 2015. Food Trucks in the US: Market Research Report. [online] Available at: <http://www.ibisworld.com/industry/food-trucks.html> [Accessed 1 May 2016]. Lörrach, 2016a. Grosse Kreisstadt Lörrach in Zahlen. [online] Available at: <http://www.loerrach.de/de/Wirtschaft/L%C3%B6rrach-in-Zahlen> [Accessed 16 May 2016]. Lörrach, 2016b. Parken in Lörrach. [online] Available at: <http://www.loerrach.de/Parken> [Accessed 16 May 2016]. Profitable Venture, 2015. A Sample Mobile Food Truck Business Plan Template. [online] Available at: <http://www.profitableventure.com/food-truck-business-plan/> [Accessed 1 May 2016]. Santoro, R., 2015. How Entrepreneurs are Making Big Bucks with Food Trucks. [online] Available at: <http://www.entrepreneur-ideas.org/how-entrepreneurs-are-making-big-bucks-with-food-trucks/#.VzNAkmNBVd0> [Accessed 10 May 2016]. SDCNet, 2010. Mobile Food Vendors. [online] Available at: <http://www.sbdcnet.org/small-business-research-reports/sbdcnet-connections-issue-55-mobile-food-vendors> [Accessed 16 May 2016]. Statistisches Landesamt Baden-Württemberg, 2016. Allgemein Bildende Schulen Lörrach. [online] Available at: <http://www.statistik-bw.de/BildungKultur/SchulenAllgem/13015030.tab?R=GS336050> [Accessed 16 May 2016].

http://www.imbisskult.de/projekte/foodtrucks/

http://www.entrepreneur-ideas.org/how-entrepreneurs-are-making-big-bucks-with-food-trucks/#.VzNAkmNBVd0

http://www.entrepreneur-ideas.org/how-entrepreneurs-are-making-big-bucks-with-food-trucks/#.VzNAkmNBVd0


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Streatfood, 2016. Food Truck Finder. [online] Available at: <http://www.streatfood.ch/> [Accessed 1 May 2016]. Wolf, M., 2015. Foodtrucks in Deutschland - Versuch einer Marktanalyse. [online] Available at: < http://www.foodtrucks-deutschland.de/blog/food-truck-markt-potential-volumen-schaetzung> [Accessed 2 May 2016].


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Appendix

Financial Figures

Pessimistic Financial Scenario


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Optimistic Financial Scenario


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Costs for Truck Location - City of Lörrach


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Service-related Competition

Direct Competitors:


Food Trucks offering Catering Services with focus on Arepas

As already highlighted in the market overview, there are currently no food trucks offering arepas in the region and consequently also no catering services.

Restaurant / Catering Companies offering Catering Services with focus on Arepas

According to thorough market analysis, there are no Venezuelan / Colombian restaurants neither catering companies offering arepas in the region.

Conclusion: There are no direct service-related competitors offering exactly the same service like the food truck aRepas in Lörrach or Basel.

Indirect Competitors:


Existing Food Trucks offering Catering Services

Already have more experience, already have established a loyal customer base, already gained some popularity as catering services among private clients and businesses, higher recognition value, high traffic social media pages and webpages, good established business channels, individual service Client’s criterion for selection: already know their food, require something new for their event, prefer the individualism, like foreign food, trendy, healthy and fresh preparation

Offer no gluten free products for people with allergies, decreasing surprise factor since their offer is known, dependent on weather and / or location (if customers have a big hall), depend on their truck for food preparation (not so much space)

Restaurant offer Preparation of food in the Often more expensive, not so easy


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Catering for Events

restaurant kitchen, are able to produce more beforehand, not dependent on weather and / or location, can prepare a wider variety of dishes Client’s criterion for selection: already clients of the restaurant and know the food choice, would like to spend more money for their event

to keep the prepared food warm and fresh → loss of taste, often in buffet form and no personal interaction (self service),

Catering Companies

Preparation of food beforehand in a big kitchen, have lots of equipment, are able to produce more beforehand, not dependent on weather and / or location, can prepare a wider variety of dishes, recognized by many companies as catering providers, good relationships with companies, are able to cater for many people Client’s criterion for selection: good established relationship with catering company, good price, event for many people

Often more expensive, not so easy to keep the prepared food warm and fresh → loss of taste, often in buffet form and no personal interaction (self service), mass production, loss of individualism

Chicken Trucks of local Butchers (additional business)

Local butcher’s food, everyone knows the food offer, cheaper, good for kids, experienced Client’s criterion for selection: prefer local food, are not sure if everyone likes foreign new food, cheap alternative

Cannot cater for too many people (need to know the amount of chickens beforehand), more fast food

Conclusion: Overall, the indirect competitors benefit of their experience and better preparation possibilities. In the contrary, with exclusion of the other food trucks, they often miss the personal interaction and individual service and are not able to offer their food as warm and fresh as the food truck aRepas, which also caters for people with certain allergies.

Interview with Manuel Eberle Owner of Meat & Great Food Truck Basel


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1. Was begeistert euch am meisten an eurem Food Truck Business? Was motiviert Euch?

Die Motivation etwas zu erschaffen alleine treibt uns täglich an. Wir haben

unseren Food Truck selber entworfen und gebaut, mit viel Schweiss und Fleiss.

Des Weiteren genießen wir eine sehr coole Freundschaft und können gut über

Dinge miteinander sprechen. Das macht auf jeden Fall schon sehr viel aus.

Ausserdem sind wir täglich von unserem Einsatz abhängig, da er unseren Lohn,

oder sogar "überleben", am Ende des Monats bestimmt.

2. Am Anfang musstet ihr einige Investitionen machen, was genau gehört alles dazu? —> Food

Truck, Umbau des Trucks, Küchenequipment, Kühlschrank, Lizenzen, Stühle, Tische,

Lebensmittel,…

Die Firmengründung ist bestimmt der erste Teil was Geld schluckt. Das ist aber in

jedem Kanton und mit jedem Notar anders. Informiere dich am besten in einem

Business-Zentrum am Ort deines Wunsches.

Zusätzlich gehören natürlich alle deine Materialkosten dazu, was sich bei einem

gekauften Food Truck schnell an die 80'000chf bewegen kann.

Die Kosten sind aber individuell und nicht generalisierter, achtet darauf was ihr

alles braucht um euer Wunschprodukt herzustellen.

3. Welche Lizenzen braucht man als Food Truck Besitzer? Gibt es irgendwelche

Richtlinien/Regularitäten, die man einhalten muss? Wie habt Ihr euch da informiert?

Anmeldung beim Gesundheitsamt des jeweiligen Kantons. Wenn ihr mit Gas

kocht braucht man auf einzelnen Geländen auch eine angenommene

Gasanlage(Gasprüfung)

4. Ihr habt einen wöchentlich festen Platz für Euren Food Truck. War es schwer, diesen zu

erhalten?

Wir haben 5 feste Plätze unter der Woche. Schwer ist immer relativ.

5. Ihr seid regelmässig auch an Street Food Festivals - ist es schwer gewesen dort

reinzukommen?

Nein, war nicht schwer kostet einfach.


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6. Wie habt ihr es am Anfang geschafft, die Leute auf Euch aufmerksam zu machen, bzw. Traffic

auf Eure Facebook Seite und Homepage zu bringen?

Das ist wohl teil Eurer Maketingstrategie. Hierzu enthalte ich mich

7. Wie würdet ihr Eure Hauptkunden beschreiben? Was machen Eure Kunden aus?

—> Regelmässige Kunden? Zufällige Kunden?

Hierzu kann ich dir leider auch keine weitere Auskunft geben.

8. Ihr habt euch auf die Nutzung von lokalen Lebensmitteln fokussiert - habt ihr da feste

Händler, Zulieferer?

Ja das haben wir, lohnt sich auf jeden Fall.

9. Wie überzeugt ihr Gäste an Festivals, Eure Produkte und nicht die Eurer Konkurrenten zu

kaufen?

Einfache Überzeugung des eigenen Produktes hilft extrem viel und bringt eine

tolle Ausstrahlung.

11. Wie ist allgemein Eure Meinung über die Food Truck Industrie?

Gefällt uns sehr gut.

12. Denkt ihr die Food Truck Industrie wird sich in nächster Zeit verändern? Wenn ja, wie?

Alles ist im Wandel, es wird sich zeigen wie sehr auch die Leute und die Food

Truck Betreiber Freude am Street Food haben. Ich denke das ist der wichtigste

Punkt

13. Was würdet ihr „Food Truck Einsteiger“ wie uns als wertvollen Tipp mitgeben? Was sollten

wir beachten oder ansprechen in unserem Business Plan?

Mein Tipp: Wenn’s deins ist gib alles was du hast. Work hard, play hard.

14. Was war die grösste Herausforderung für Euch in eurem Business bisher?

Das bauen des Food Truck war sicher eine der grössten Herausforderungen. Und

die Umstellung vom "daily" Job zum selbständigen "Entrepreneur" ist auch ganz

schön happig.


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15. Wenn ihr an Eure bisherige Zeit als Food Truck Besitzer zurückdenkt, würdet ihr im

Nachhinein etwas anders machen?

Gründet eine GmbH, und rechnet genug Zeit ein. Es geht alles länger als es zu

scheinen mag

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